Intellectual Property Law

Amid reports of steadily declining CD sales, the music industry has adopted the controversial strategy of suing customers who it contends illegally download music files for copyright infringement. The industry has also attempted to shut down the web sites of the providers of downloadable files, claiming a significant victory with the Supreme Court?s Grokster ruling that providers can be liable for contributory copyright infringement. However, it is the legal pursuit of its own customers that has generated the most attention. While the practice of free downloading of music is far too widespread to make it possible for record companies to sue all potential infringers, the industry hoped that by going after some of the more prolific downloaders and publicizing its enforcement efforts it could persuade a substantial segment of those individuals to download music from authorized web sites.

An organization that has spoken out against the music industry?s copyright litigation and taken on the industry in court now claims that the strategy of suing consumers has not significantly reduced the number of unauthorized downloads. According to available data ? which is admittedly not entirely reliable and may not tell the whole story ? there has been a slight dip in illegal peer-to-peer file sharing. This decline has likely been more than offset, however, by the swapping of music files by MP3 player owners.

At the same time, notwithstanding the litigation by the music industry, album sales continue to decline ? by about 7% last year alone. This is not surprising, according to a 2004 study by a professor at the Harvard Business School, which concluded that there is no direct correlation between the sharing of digital music files and lower CD sales.

If indeed the information that its litigation strategy is not working is correct, what can the music industry do to stop the free-falling sales of its products? Certainly, methods for the digital distribution of music on a fee-paying basis are gaining in popularity ? whether under the pay-per-song model or a monthly subscription basis ? but these authorized download sites provide only a fraction of the industry?s revenues. If conventional music sales continue to decline, will the industry be able to continue to find and develop new talent? Can the copyright laws provide protection to music companies or should they look to other solutions? What do you think?

Today's Blogger:  Bob Sloss